New Straits Times

OCBC AL-AMIN, RHB UNIT SEAL HISTORIC DEAL

Both parties complete US$175m green Islamic foreign currency and bank-to-bank term financing facility

OCBC Al-Amin Bank Bhd (OCBC Al-Amin), the Islamic banking unit of OCBC Bank (Malaysia) Bhd (OCBC), has extended a pioneering US$175 million Islamic green term financing facility to RHB Islamic Bank Bhd (RHB

Islamic).

This is Malaysia’s first green Islamic foreign currency as well as bank-to-bank term financing facility.

Using the facility, RHB Islamic will offer comprehens­ive environmen­tal, social, and governance (ESG) financing solutions to its clientele.

The term financing extended to RHB Islamic is a historic facility

OCBC Al-Amin Bank Bhd chief executive officer Syed Abdull Aziz Syed Kechik (fifth from right) and RHB Islamic managing director Datuk Adissadiki­n Ali (fifth from left) at the signing of the US$175 million Islamic green term financing facility yesterday.

in both the country and the bank’s journey towards achieving the ideals of the Islamic banking industry’s sustainabi­lity agenda, said OCBC Al-Amin chief executive officer Syed Abdull Aziz Syed Kechik.

“We are pleased to collaborat­e with RHB Islamic on this significan­t syariah-compliant financial solution and will continue to strengthen our green efforts, working with our industry peers to achieve net-zero in Malaysia by

2050,” he said.

“Islamic green term financing” pertains to financing that adheres to syariah requiremen­ts.

The facility features a pioneering Islamic term financing using the use-of-proceeds method in applying proceeds directly to targeted economic segments in an environmen­tally and socially responsibl­e manner.

The term financing is embedded with an Islamic cross-currency swap arrangemen­t, which provides

a syariah-compliant hedging mechanism that protects against currency fluctuatio­ns.

RHB Islamic managing director Datuk Adissadiki­n Ali said the financing facility aligned with the group’s commitment to upholding value-based intermedia­tion principles.

It also supported the bank’s sustainabi­lity strategy and roadmap, particular­ly its aspiration to develop a path to net zero by 2050, he added.